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Adam Smith Institute paper argues for BBC to become a Pay-TV service

BBC A new report from the Adam Smith Institute calls for the BBC to move to a voluntary subscription system for its income and give up its licence fee model.

Within the executive summary of the report, written by former BBC producer David Graham, the case against the existing licence fee model is summarised:

  1. "It criminalises poor people.
  2. It forces people to pay for genuinely “free” services funded by advertising.
  3. It obliges the BBC to replicate a crude commercial model based on mass-audience advertising.
  4. Universal broadband and the Internet make a “licence” to broadcast obsolete. On the other hand, they enable direct delivery of services outside the UK. The current funding model denies access to Britons and others resident overseas."
Mr Graham argues that a subscription model is the way forward for the BBC:
  • "Subscription or Pay-TV is the medium’s largest and fastest growing revenue stream, and has the greatest ability to meet and “monetise” diverse tastes and preferences. Subscription services in the US have been responsible for some of the contemporary content most admired by professionals.
  • Voluntary subscription (with some subsidy for core public service content) affords the opportunity to enhance ownership, involvement and participation. Nearly everyone in Britain watches or listens to BBC services every week. A large majority would be likely to subscribe."

Tom Clougherty, Executive Director of the Adam Smith Institute adds:

“The status quo will not be an option for the BBC for much longer. The licence fee is already an anachronism, and opposition will grow as technological advances and changing viewing preferences make it even more outdated. But most of the reforms on the agenda at the moment – like scaling back the BBC or sharing licence fee revenues with other broadcasters – risk stifling the potential of the British media. Our proposals, as well as addressing the unfairness of the current system, would set British broadcasters free to make a significant contribution to economic growth.“

A PDF of the full paper.


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